Which of the Following Statements Is True with Respect to the Law

question 165

Multiple Choice

Which of the following statements is true with respect to the law of damages?

• A)Damages are awarded for a breach of a condition but not for a breach of warranty.
• B)If a contract contains a liquidated damages clause,the party who has breached the contract has agreed to pay to the party wronged an amount equal to all the loss that directly and naturally flows from the breach.
• C)Damages are an order from the court for the breaching party to perform the contract as he or she agreed to do.
• D)Damages are intended to punish the wrongdoer for breaching the contract.
• E)A deposit is an amount of money a party to a contract agrees to forfeit if he or she breaches the contract.

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Definitions:

Discontinued Operation

A business segment that has been sold, abandoned, or otherwise discontinued, and is reported separately in financial statements.

Income Statement

A financial statement detailing a company's revenues, expenses, and profits over a specific period, often quarterly or annually.

Operating Expense

This refers to the costs associated with running a business's day-to-day operations, excluding costs linked to production.

Tax Effect

The impact of a company's tax obligations on its financial statements, including how taxes affect the overall expenses and net income.